Tony Todaro had 20 subcontractors and an impressive roster of high tech and financial services industry clients, but he was still working out of his Redondo Beach, California, home. He was hesitant to lease office space again. Five years earlier, he moved his marketing communications firm, Todaro Communications Inc. into an office on the 18th floor of a Los Angeles high rise. When the 1994 Northridge earthquake struck, extensive damage to his office and equipment sent him back to the homebased world.

By late last year, however, he was looking around again for a real office.

"I needed a formal place to make formal presentations to clients," says Todaro. He also felt an office would improve his image because "big companies like to have a feeling of doing business with a company of their peers."

This time he found a great alternative to a full-time office-classy offices and conference rooms he can use on an as needed basis. He found what he was looking for at e-Virtual Suites, located in a sleek, blue and yellow office building near the Los Angeles airport. eVirtual Suites rents offices, conference rooms and business services on an as-needed basis, while making available full-time receptionists to answer private, dedicated phone lines.

The company provides clients with a permanent address, a building directory listing, and phone, fax and voice-mail service. When using the space, Todaro can take advantage of clerical services from word processing, faxing and copying to mailing, printing and notarizing. When he's not there, "telereceptionists" answer his calls. A pop-up screen on their computer terminals provides information specific to his business. They can also patch calls through to him anywhere in the world. By not having full-time space or hiring a receptionist or clerical support, Todaro keeps his overhead low and can pass those savings on to his clients.

Why Go Virtual?

More and more homebased entrepreneurs are relying on virtual offices or renting time and conference rooms in traditional temporary office facilities. A virtual office provides a flexible and affordable way to bridge the gap between working at home and moving into permanent space. Part-time real estate arrangements, coupled with high technology, create a seamless feeling of having an outside office even on the days when you're working from home, according to Loriann Hoff Oberlin, author of Working at Home While the Kids are There, Too.

Oberlin says she's seen many successful homebased businesses move out too quickly and "blow it all away" by renting offices they really can't afford.

"Jumping to an outside office should be your last recourse, not your first," Oberlin says. "Many dream of outside space but then have a hard time keeping up with the actual overhead. A virtual office lets you test the waters. You don't have that sole financial responsibility for the office."

The man behind eVirtual Suites is Lyle Maul, a serial entrepreneur who began in the real estate business and has had several successful ventures through the years.

"We were out looking for office space ourselves," says Maul, president and founder of eVirtual Suites, during an interview in one of the building's elegant conference rooms.

When he was faced with signing a 42-page lease complete with a personal financial guarantee, Maul said he began to think about buying a building and outfitting it for other entrepreneurs to share.

"eVirtual Suites is ideal for those seeking a part-time professional office environment-while projecting the prestige and perception of a professional office," says Maul, who purchased the building on Rosecrans Avenue in Hawthorne, California in 1998 and invested about $750,000 in renovating and upgrading the building, which features a parking garage and atrium.

"Telecommunications has made it possible for people to work from anywhere in the world," Maul says. "However, there's still a need to maintain a professional image. Dedicated business lines, answered by a live person, and a professional business address enable a businessperson to project the perception and prestige of a professional office."

Through a strategic alliance with Velocity Networks Inc., eVirtual also offers clients high-speed access to the Intenet via DSL and T-1 lines. For an additional charge, Velocity provides private networking, Web design and other Internet capabilities including linking a client's home and office to the unified messaging, Web hosting and Internet-based phone services offered by eVirtual Suites.

"Technology really makes it easy for a company to appear bigger and more professional," says Kurt Wolfgang, CEO of Velocity Networks. By signing up for an eVirtual and Velocity package, he says, "companies get a virtual office and get virtual technology. They don't have to shop two places." eVirtual client packages run from $165 for a basic package to $339 per month for a deluxe deal. There is a three-month commitment required. Velocity's add-on "Managed Office" packages start at $199.

"It's high enough to keep the flake factor out, but low enough to be affordable," he says. "It's as nice as being on the 18th floor of an executive building."

Should You Stay or Should You Go?

So how do you know it's time to move out or rent space in a virtual office?

According to homebased business expert Oberlin, the best reasons for moving out are: You have the necessary cash flow to support an outside office, you absolutely have to have more space for yourself and employees, or you need to upgrade your image to attract or retain clients.

"If you go through feast or famine periods, it might not be such a great idea to rent an office," Oberlin advises. "The rent is due each month no matter what. You have to have the kind of business where cash flows in steadily."

Oberlin says homebased workers are still perceived negatively by some but can overcome that by projecting as professional a business image as possible.

Virtual offices can add to your professional arsenal with little risk. "The few times you need it, it's there," Oberlin says. "You can look larger, but stay small."

Reporting by Anne Ruth

Jane Applegate is a syndicated columnist, author and founder of SBTV.com, which provides online multimedia resources for entrepreneurs.